Tax on single use plastics, foreign digital services approved by House panel

RG Cruz, ABS-CBN News

Posted at Aug 17 2022 06:55 PM

MANILA - The Lower House’s tax panel on Wednesday approved several new proposed tax measures including a tax on foreign digital services and single use plastics. 

The House Ways and means Committee approved the VAT on nonresident digital service providers (DSPs), which it said levels the playing field between traditional and digital businesses.

“The measure also aims to strengthen tax compliance through simplified invoicing and registration requirements for VAT-registered nonresident DSPs,” said Committe chairman Albay Rep. Joey Salceda.

Salceda proposed a similar bill in 2020 which sought to tax Netflix, Spotify, Facebook, Google and other global internet companies that do business in the Philippines. 

The House panel also approved the P20-excise tax per kilogram of single-use plastics.

The measure “seeks to impose an excise tax of Twenty Pesos (P20.00) for every kilogram of plastic bag removed from the place of production or released from the custody of the Bureau of Customs. 

The allocation of the proceeds, which is estimated at P1 billion per year, will be used for the implementation of the solid waste management.”


Another approved measure, dubbed as the Ease of Paying Taxes Act (EOPT), aims to reduce documentary requirements for tax payers, allow tax payers to file their returns in any revenue district office, and remove the annual taxpayer registration fee. 

“The bill aims to simplify tax filing and payment, and address burdensome tax compliance which affects our small and medium enterprises and turns off our investors. We hope that this could reduce the tax gap, estimated to be P909 billion in 2018,” Salceda said.

It will also institute a taxpayer Bill of Rights and designate a taxpayer advocate office.

“The EOPT seeks to segment taxpayers, to simplify the forms and requirements for small taxpayers; allow filing and paying of taxes to be portable; harmonize the documentation for substantiating VAT credits; and institutionalize a Taxpayer’s Bill of Rights,” he said. 

The House panel will try to finish all the priority bills of President Ferdinand Marcos Jr and the department of Finance this month, Salceda said. 

“Hopefully, by next week, the House tax panel is done with everything, so we can proceed with our own tax measures as well as the administrative and oversight matters,” Salceda added.

The Philippines needs to boost revenue collections to plug a widening budget gap and reduce debt which is projected to reach around P13 trillion by the the end fo the year. 


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